Coming Soon from Brown Books
I have read responses about the possibility of congress approving $25,000 incentives; forget it! In the context of drafting legislation, Bills were proposed approving incentives “up to $25,000 per retiree.” This is light years beyond approved legislation that would transcend into money in your pocket because it was only a proposal “to authorize the Postal Service to grant incentives.” Under the most generous proposals, the proposed legislation only authorized the Postal Service to “negotiate” incentives.
Negotiations have been concluded and the amount agreed to was $15,000. There will not be a penny more at some later date. If you intend to retire my advice is to “take the money and run,” there is zero possibility that the amount will be increased. And for those who hope that a similar offer will be made in the future, I suggest that the odds are heavily against another incentive any time soon. The circumstances surrounding this incentive are unique and are highly unlikely to be repeated, ever. Consolidations and service standard changes will make it possible to process a changing mix of mail with fewer employees. The only mail that is growing is Standard mail and parcel post. Standard mail is not time sensitive consistent with service standards, and mailers can make adjustments in mail preparation and points of insertion in the mail stream. There is nothing in the pipeline that will facilitate a need to reduce the complement faster than the normal rate of attrition.
The principle driver of this incentive is the monetary reward in replacing existing employees with new employees hired under the new wage scale. Postal costs are reduced by 50% when a retiree with 35 years of service is replaced by a new employee. Just the simple replacement of a body for a body and labor costs are reduced in half. At no time in the future, no matter the bargaining philosophy employed by the negotiators will there be a similar gap between old and new employees. Future negotiators, no matter how inept cannot reduce labor costs in similar amounts without violating minimum wage restrictions. So if you want or need an incentive this is probably your last and best opportunity.
For those that do not qualify for this incentive, you are out of luck. The only remote salvation is that the number of employees who accept is surprisingly small and to achieve the expected 20,000 to 25,000 employee reduction it will be necessary to repeat the process in the future. My best estimate is that of the 115,000 APWU represented eligibles there will be somewhere in the range of 35,000 who will take the money and run. If I am in the ball park, this will be the last and final retirement incentive in the next 50 years.